Prime Minister Malcolm Turnbull and Governor-General Peter Cosgrove greeted chef de mission Kitty Chiller and flag bearers Anna Meares and Kim Brennan as they left the plane on Thursday morning.
"This is a family occasion. The big Australian family - 24 million of us," Mr Turnbull said to the Sydney airport crowd.
"I know you felt in your heart the support of the whole nation as we celebrated your successes and as we watched you write the latest chapter of Olympic history.
"We embrace you, we applaud you, we have been inspired by you, we are so proud of you."
Opposition Leader Bill Shorten and Sport Minister Sussan Ley also greeted the lead team.
Cycling champion Meares, who won a bronze medal, said leading the team was a career highlight.
Medal winners travelled business class on the Qantas charters, which rowing gold medallist Brennan described as a "real treat".
"This has been a wonderful team to be a part of, a great team to lead and I couldn't ask for a better way to start Rio and come home," she told Seven.
Family members greeted the other athletes with hugs and kisses in a ceremony at the Qantas hangar.
Swimmer Mack Horton, who won gold in the 400m, said he was excited to be home but "sad to be leaving the team".
His mum Cheryl was delighted to have him back and was proud of his and the team's achievements.
"The whole team has done an amazing job, in particular the way they handled themselves when things haven't gone as they had hoped," she told Seven.
And there was special praise for her son: "He is amazing, what can I say? He takes after his mother."
Surprise gold medallist Chloe Esposito said she was glad Australia could watch her win the country's first medal in the modern pentathlon and her achievement was still to hit home.
"It's so special and it really is sinking in now seeing all of this," she said.
